State v. Dearing

• Decision Date: 24 February 1904
• Parties: STATE ex rel. SOUTH MISSOURI PINE LUMBER CO. v. DEARING, Judge, et al.
• Court: Missouri Supreme Court

79 S.W. 454

180 Mo. 53

STATE ex rel. SOUTH MISSOURI PINE LUMBER CO. v. DEARING, Judge, et al.

Supreme Court of Missouri.

February 24, 1904.

COURTS — JURISDICTION — SUIT AFFECTING LAND — INJUNCTION — DISSOLUTION OF INJUNCTION—APPEAL—CONTINUANCE OF PRELIMINARY INJUNCTION PENDING APPEAL.

1. Plaintiff corporation alleged that the promoters of the corporation and others had by a fraudulent conspiracy sold the corporation certain real estate at a sum greatly in excess of what they had purchased it for, and there was a prayer for a personal judgment against defendants for the value of the property which it was alleged they had fraudulently obtained, for damages for the fraudulent representations, and for a cancellation of notes given by the corporation in payment for the land, and for an injunction restraining any foreclosure under a deed of trust given to secure the notes. Held not an action whereby the title to real estate may be affected, within Rev. St. 1899, § 564, providing that such suits must be brought in the county where the real estate is situated.

2. Where a circuit court, on the merits, dissolved an injunction and dismissed the plaintiff's bill, it had power to continue the temporary injunction in force pending an appeal from such judgment; Rev. St. 1899, § 3649, providing a remedy by injunction to prevent the doing of any legal wrong whenever any adequate remedy cannot be afforded by an action for damages; section 3630 authorizing a temporary injunction, "during litigation," and section 3637 providing for security to protect from injury by an injunction.

In Banc. Proceedings in prohibition, on the relation of the South Missouri Pine Lumber Company against Frank R. Dearing, as judge of the circuit court of Wayne county, and others, prohibiting the prosecution of the suit of William Crommer and others against relator. Preliminary rule made absolute, and peremptory writ issued.

Johnson, Rusk & Stringfellow and Robt. A. Holland, Jr., for relator. M. R. Smith, W. S. Anthony, and O. L. Munger, for respondents.

BRACE, J.

This is a proceeding in prohibition, instituted in this court, in which the questions to be determined are raised by demurrer to the returns of the respondents. The facts admitted by the pleadings, material to the present inquiry, are, in substance, as follows:

"In a suit in equity brought by the relator company in the St. Louis city circuit court on the 26th of March, 1902, against William Crommer, William F. Crommer, E. P. Ewart, S. C. Newhouse, and S. J. Malugan, in which the relator company sought a discovery of an accounting for, and the recovery of the value of, certain shares of relator's capital stock and other valuable property which it was alleged the said Ewart and Newhouse had received by means of a fraudulent conspiracy by them entered into with the said Crommers, whereby, in the promotion of the organization of said company, a lumber plant, consisting of 7,500 acres of land situate in the counties of Carter, Wayne, and Butler, and other property appurtenant to and connected therewith, contracted for by said promoters for the sum of $21,000, was fraudulently sold by the said Crommers to the relator company for the sum of $37,250. The relator, in its petition, in which the fraudulent acts complained of are set out in detail and at great length, in substance prayed for a personal judgment against the said William Crommers, William F. Crommers, E. P. Ewart, and S. C. Newhouse for the value of the property alleged to have been so fraudulently obtained for damages for fraudulent misrepresentations as to the quality and value of said lumber plant, and further prayed `that six notes of one thousand dollars each,' secured by a deed of trust on said lands, given by the relator in part payment of the purchase money for said property, and held by the said Crommers, be canceled, set aside, and for naught held'; and, further, `that all of the defendants, their servants, agents, attorneys, and employés, be enjoined from selling or attempting to sell on the 11th of April, 1902, or at any other time, the property described in said deed of trust, or any part thereof, or from attempting to collect said six notes of $1,000 each; and that in the meantime a temporary writ of injunction be issued enjoining and restraining all of said defendants, their agents, servants, and employés, from selling or attempting to sell the property described in said deed of trust, or any part thereof, or from transferring said six notes of $1,000 each, or any of them, or from attempting to collect the same; and for such other and further orders and relief as to the court may seem proper, the premises considered.' The said Malugan was made a party defendant in the action because, as substitute trustee, he, at the request of the Crommers, had advertised said real estate for sale under said deed of trust on the 11th of April, 1902. Upon the filing of the petition and the execution of an injunction bond in the sum of $6,000, with approved security, a temporary injunction was issued.

"Afterwards the defendants in due time filed answer to plaintiff's petition, the answers of Ewart, Newhouse, and Malugan being in the nature of a general denial, and the answer of the Crommers putting in issue the allegations of the petition, and containing a cross-bill, in which they asked for judgment upon said notes and the foreclosure of said deed of trust. Upon these answers issue was duly joined by reply. Afterwards said cause coming on for trial upon the issues joined before Honorable James R. Kinealy, judge of Division No. 10 of the circuit court of the city of St. Louis, and on the 23d day of June, 1903, the said judge of said court, after hearing the evidence in said cause, found the issues in favor of the defendants, and made an order dismissing plaintiff's bill, and found the issues against the defendants upon their cross-bill, and made an order dismissing said cross-bill. Said order and judgment of said court was in words and figures as follows, to wit: `Now at this day this cause coming on for hearing, come the parties herein by their respective attorneys, and submit this cause to the court upon the pleadings and evidence and duly considered the same, doth order and adjudge that the temporary injunction granted in this cause on March 26th, 1902, be, and the same is hereby, dissolved in every particular. And the court doth find the issues joined in the plaintiff's petition herein in favor of defendants. It is thereupon considered and adjudged by the court that the plaintiff take nothing by its suit in this behalf, and that defendants go hence without day, and recover of plaintiff and the American Surety Company of New York, surety on the injunction bond, their costs and charges herein expended, and that execution shall issue therefor. And the court doth further find the issues joined in the cross-bill of defendants William Crommer and William F. Crommer in favor of the plaintiff. It is therefore considered and adjudged by the court that the defendants William Crommer and William F. Crommer take nothing by their suit on the cross-bill herein, because of want of jurisdiction in this court over the subject-matter thereof.'

"On the day following, June 24, 1903, the said Crommers brought suit in the circuit court of Wayne county against the South Missouri Pine Lumber Company upon the said six notes held by them against the company, in which they sought to recover judgment for the amount of said notes, and in the petition they also prayed for a decree foreclosing their deed of trust, and asked that a receiver be appointed for the company, alleging insolvency, mismanagement, and other grounds as a reason for the appointment of a receiver. On the day following— June 25, 1903—the attention of Judge Kinealy was called to the fact that said suit had been brought by the defendants Crommers in the Wayne county circuit court, and at the request of the South Missouri Pine Lumber Company, and in open court, in the presence of counsel for both sides, Judge Kinealy made an order continuing the preliminary injunction in force pending the disposition of the motion for new trial on that day filed therein, and the Crommers refrained from taking any further steps in said Wayne county case pending the disposition of the motion for new trial. On July 11th the motion for new trial in the St. Louis case was taken up and argued, and submitted to Judge Kinealy, and was by him overruled, whereupon the South Missouri Pine Lumber Company filed its motion, in which it asked that the court modify its decree to the extent of continuing in force the injunction against the Crommers pending the appeal to the Supreme Court, alleging that the Crommers were insolvent, and, unless the injunction was so continued, would proceed at once to force the collection of their notes, and would succeed in doing so before the case could be determined by the Supreme Court. This motion was heard and considered by the court. All of the parties were represented, and the Crommers were present in person and by counsel. The motion was sustained, and the court, as its final judgment, continued in full force and effect the injunction which had been issued at the bringing of the suit until the case could be decided by the Supreme Court, upon condition that the plaintiff, the South Missouri Pine Lumber Company, give a bond to the defendants Crommers in addition to the statutory appeal bond in the sum of $14,000, conditioned for the payment of said notes and interest in full in case said judgment should be affirmed in whole or in part. On the same day plaintiff complied with said order by filing its bond in the sum of $14,000, conditioned as required by said judgment, with the American Surety Company of New York as surety, which said bond was on that day approved by the court. After the modification of said decree, plaintiff filed its affidavit for appeal. On said 11th day of July...